Wednesday, June 18, 2014

Follow Up: Zillow's "Coming Soon" Feature

The National Association of Realtors (NAR) issued a warning on "coming soon" marketing, since the issue was raised by Zillow's new "coming soon" feature.  NAR says brokers who do not act in the best interest of their clients by informing them of the limited nature of coming soon marketing could face liability.

"Coming soon" marketing is another form of pocket listings, where a Realtor has either a verbal agreement with a homeowner to sell their property, or has a written agreement.  The MLS I belong to, MFRMLS, is the 2nd largest in the country.  MFRMLS rules require a listing to be input in the MLS within 48 hours of completing a written listing agreement.  A "coming soon" listing could only be in effect with a true written  agreement for 48 hours, using Zillow's "coming soon" feature.

In my previous blog post, I outlined how "coming soon" listings have the potential for abuse.  A Realtor could technically have a verbal listing agreement with a homeowner and indefinitely market the property as "coming soon" on Zillow.  This brings a lot of pitfalls for potential buyers, who may find the home isn't really for sale, the seller isn't willing to sell yet, or the seller changes the price or terms once an offer is presented.  

It also impacts sellers who are not getting full exposure to the entire real estate market by not being listed in the MLS.

In fact, one broker in Indiana has already warned it's members that "coming soon" listings violate state real estate law and local MLS regulations, and can result in a $500 fine.  I expect to see a lot more local MLS and brokerages across the country come out with specific rules and language dealing with "coming soon" listings.

Zillow is not a licensed real estate broker.  Therefore, they do not follow the Real Estate Code of Ethics nor are they regulated by the NAR.

More about how Zillow operates and why you should avoid it:  http://www.davidbarrhomes.com/#!debunking-zillow-sarasota/cftb


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